The U.S. Federal Reserve will not raise interest rates this week, Turkey’s Economy Minister Nihat Zeybekci predicted Monday. That announcement could feature the first interest rate hike since 2006 and put an end to almost seven years of near-zero percent interest rates.
“I don’t think the market is fully pricing in the Fed moving or not”, said Adam Petryk, head of investment solutions at QS Investors, an asset manager owned by Legg Mason Inc. that focuses on quantitative equity strategies. Japan’s Nikkei 225 lost 1.6 percent, and South Korea’s Kospi lost 0.5 percent.
At 9:55am ET (1355 GMT) the Dow Jones industrial average was up 59.06 points, or 0.36%, at 16,430.02, the S&P 500 was up 5.85 points, or 0.3%, at 1,958.88 and the Nasdaq Composite was up 9.66 points, or 0.2%, at 4,815.43.
With the Fed set to start its two-day policy meeting Wednesday, the chatter on Wall Street is increasing as trading activity remains light.
“If you just look at the USA economic fundamentals – US data – yes, the Fed should be hiking rates”, Woo acknowledged. Copper prices tumbled to a one-week low on Tuesday as jitters about demand from China fuelled negative sentiment, which was also undermined by lower equity prices in Shanghai. This option would give the Fed more time to assess global conditions, but it would keep alive the “will they/won’t they” debate for three more months – and a later liftoff could necessitate a steeper tightening path, he conceded.
In Asia, shares have been trading in a narrower range in recent sessions, stabilizing somewhat from an earlier summer selloff.
In August alone, panicky investors dumped equities held in emerging economies to the tune of $8.7 billion, according to the Institute of worldwide Finance.
Most Asian markets were in the red on 15 September as investors awaited a crucial policy-setting meeting from the US Federal Reserve. “There is concern about the Fed, plus the China data continuing to be weak”.
If it were up to him to decide whether or not to raise interest rates, Miller says he would be inclined to do so.
“With a slim chance of making a profit in this market, money is not following in”, said Zhou Lin, analyst at Huatai Securities.
The probability has declined along with signs of a slowdown in China and last month’s rout in global stocks.
Go Pro was up 2.5% at $33.72 after Northland Capital Markets said the wearable camera maker’s growing sports content and video ecosystem made it a compelling acquisition target for Apple and other companies seeking original content.
Shortly before the start of trading, the Fed is also scheduled to release a report on industrial production in the month of August.
Spot gold was little changed at $1,104.60 an ounce by 0330 GMT.
Fed Chair Janet Yellen has previously said that a rate rise is “date dependent”-and Weber highlighted that the estimate for USA economic growth in the first quarter has been upgraded to an annualized 0.6 percent”.
Gregor Stuart Hunter, James T. Areddy and Yifan Xi contributed to this article.